An Irrevocable Life Insurance Trust (ILIT) can be an effective estate planning tool for Arcadia residents who want to manage life insurance proceeds outside of their taxable estate. At the Law Offices of Robert P. Bergman, we help clients understand how an ILIT works, why a trust may be useful for preserving assets, and what steps are required to establish and fund the trust. This introductory section explains the basic goals of an ILIT, common scenarios where it is used, and how it interacts with wills, revocable trusts, and beneficiary designations so families can plan with clarity and confidence.
Setting up an ILIT requires careful drafting, transfer of ownership, and ongoing administration to achieve the intended tax and asset protection results. Many people use an ILIT to keep life insurance proceeds out of their taxable estate, provide liquidity to pay estate obligations, or secure inheritance for beneficiaries without exposing proceeds to creditors or court supervision. This paragraph outlines typical documents and steps such as trust formation, assignment of policies, trustee selection, and coordination with existing estate plans so Arcadia families have a roadmap for implementing an effective life insurance trust strategy.
An ILIT can provide multiple important benefits for those seeking to manage life insurance proceeds with precision and protective measures. By removing ownership of a policy from your taxable estate, an ILIT can reduce estate tax exposure, preserve assets for heirs, and ensure proceeds are distributed according to your wishes rather than default beneficiary rules. The trust structure also allows for tailored distributions, creditor protection in many circumstances, and the appointment of a trustee to handle administrative tasks so beneficiaries receive funds in an orderly manner. This paragraph explains how those benefits align with broader estate planning goals for individuals and families in Arcadia.
The Law Offices of Robert P. Bergman serves clients throughout California with a focus on estate planning documents and trust administration. Our team works to create clear, durable plans that reflect each client’s objectives and family circumstances, including structuring Irrevocable Life Insurance Trusts, preparing supporting instruments, and coordinating funding and trustee responsibilities. We prioritize clear communication, practical solutions, and careful documentation so that ILITs function as intended when they are needed most. Clients appreciate direct guidance on trustee selection, funding mechanics, and long term administration for their life insurance planning needs.
An Irrevocable Life Insurance Trust is a separate legal entity that becomes the owner and often the beneficiary of a life insurance policy, taking the policy outside of the insured’s taxable estate once properly established and funded. To be effective, the trust must be irrevocable, meaning the grantor gives up ownership and control, and must comply with gifting and transfer rules to avoid unintended tax consequences. Properly drafted trust provisions govern how proceeds are held and distributed, name successor trustees, and set terms for use of funds. This paragraph covers the structural essentials every Arcadia resident should know before creating an ILIT.
Establishing an ILIT requires coordinated steps beyond signing a trust document. Grantors must transfer an existing policy to the trust or have the trust purchase a new policy, and they must often make annual gift contributions to the trust to cover premiums. The trustee must manage premium payments and maintain records, while the trust document directs distribution rules for beneficiaries. Proper timing and documentation are essential to avoid inclusion in the taxable estate, particularly for policies transferred shortly before death. This paragraph details the ongoing obligations and practical administration considerations that ensure the ILIT operates as intended.
An ILIT is a trust designed specifically to hold life insurance policies and their proceeds outside of the insured’s estate. When ownership and incidents of ownership are transferred to the trust, policy proceeds can be distributed according to trust terms rather than through probate or default beneficiary rules. The trust can provide liquidity to pay estate taxes and debts, protect proceeds from certain creditors of beneficiaries, and support specific distribution plans over time. This paragraph clarifies the legal concept of ownership transfer, the role of the trustee, and the interaction between the ILIT and other estate planning instruments for Arcadia residents.
Creating an effective ILIT involves drafting the trust document, selecting a reliable trustee, transferring or assigning policies to the trust, and establishing procedures for premium funding and record keeping. The trust must contain clear distribution instructions, successor trustee provisions, and administrative powers to handle investments and payments. If the grantor plans to gift funds to the trust for premiums, these gifts should be documented and may rely on annual exclusion gifts or other strategies. This paragraph outlines the operational steps, required paperwork, and coordination needed to make an ILIT legally effective and administratively practical.
Understanding common terms used in ILIT planning helps clients make informed choices and follow the legal and tax requirements. Terms such as grantor, trustee, beneficiary, incidents of ownership, gift tax, estate inclusion, and premium funding are central to the discussion. This section provides concise definitions and contextual explanations so Arcadia residents can navigate conversations about policy transfers, taxable estate concerns, and trust administration with greater clarity. Clear definitions reduce confusion and promote informed decision making in the estate planning process.
The grantor is the person who creates the trust and transfers property or ownership interests into it. In the context of an ILIT, the grantor typically transfers ownership of a life insurance policy to the trust or causes the trust to purchase a new policy. Once the transfer is made and the trust is irrevocable, the grantor generally gives up control over the policy, which is a key factor in keeping the policy proceeds outside of the grantor’s taxable estate. Proper documentation of the transfer is essential to achieve the intended results.
The trustee is the individual or entity responsible for administering the trust according to its terms and applicable law. Duties typically include managing premium payments, maintaining records, filing required tax returns, and distributing policy proceeds to beneficiaries as directed by the trust document. Choosing a trustee who can handle administrative responsibilities, communicate with beneficiaries, and coordinate with advisors is important for the smooth operation of an ILIT. The trustee’s role continues after the grantor’s death when the trust receives and distributes life insurance proceeds.
Incidents of ownership refer to rights over a life insurance policy that could cause the policy’s proceeds to be included in the insured’s estate for tax purposes. These rights may include the power to change beneficiaries, surrender the policy, or borrow against it. To keep the policy outside the estate, the grantor must relinquish these incidents of ownership when transferring the policy to an ILIT. Careful attention to the timing and manner of transfer helps prevent unintended estate inclusion under federal or state law.
Premium funding refers to the process by which the trust pays policy premiums after a life insurance policy has been placed in the ILIT. Often, the grantor makes annual gifts to the trust that the trustee then uses to pay premiums. These gifts may qualify for the annual gift tax exclusion when structured correctly, and maintaining clear records is essential. Premium funding arrangements must be coordinated to avoid gift tax problems and to ensure the policy remains in force until the insured’s death, allowing the trust to receive the intended proceeds.
When evaluating an ILIT, it is important to compare the trust to other estate planning options such as owning a policy personally, using beneficiary designations, or relying on a revocable living trust for asset distribution. Each approach has tradeoffs related to estate tax treatment, creditor exposure, administration complexity, and flexibility. An ILIT offers specific benefits for removing life insurance proceeds from the estate, but it requires irrevocability and administrative oversight. This comparison helps Arcadia clients weigh those tradeoffs and select the approach that best aligns with their financial and family objectives.
For individuals with relatively modest assets and straightforward beneficiary goals, owning a life insurance policy individually or using simple beneficiary designations may be sufficient. If estate tax exposure is unlikely and the primary need is to ensure immediate liquidity for funeral costs or small debts, a limited approach can avoid the complexities of a trust. This option still requires clear beneficiary planning and coordination with other estate documents to ensure proceeds pass as intended and to reduce the risk of disputes or administrative delays for heirs.
When the need for life insurance proceeds is short term or transitional, such as replacing lost income during retirement planning or covering near-term expenses, a simple policy ownership approach may meet the objective without the ongoing administration an ILIT mandates. This approach offers more flexibility to change policy terms or ownership, and it avoids irrevocability. However, grantors should still consider whether potential estate inclusion or creditor claims would undermine the intended purpose and whether additional safeguards might be appropriate.
When estate tax exposure is a concern or when protection from creditor claims is desired, a comprehensive ILIT approach is often necessary to achieve reliable results. Thorough planning ensures that ownership transfers, trust terms, and premium funding steps are all aligned to minimize the risk of estate inclusion or misinterpretation. A comprehensive approach also anticipates potential changes in family circumstances, coordinates with retirement assets, and establishes trustee powers to manage and protect proceeds for beneficiaries over time, resulting in a cohesive plan that addresses multiple legal and financial considerations.
ILITs are long-term arrangements that require plans for trustee succession, record keeping, and potential modifications permitted within the trust structure. A comprehensive approach builds these features into the document, providing mechanisms to address changes in law or family dynamics. Thoughtful drafting clarifies how proceeds should be used for trusts for minors, education, healthcare expenses, or other needs, and it can establish distribution triggers and protective provisions for beneficiaries. This reduces uncertainty and supports smooth administration after the grantor’s death.
A comprehensive approach to ILIT planning coordinates the trust with existing estate planning documents, retirement accounts, and lifetime gifting strategies, which helps ensure that life insurance proceeds serve the intended purpose without unintended tax or legal consequences. It includes drafting clear trust provisions, arranging premium funding, selecting capable trustees, and planning for administration to reduce future disputes. By addressing these elements together, clients gain a durable plan that supports liquidity needs, protects beneficiaries, and integrates with broader goals for asset transition and family support across generations.
When an ILIT is created as part of a holistic estate plan, it can be used strategically to fund trusts for minor children, support special needs arrangements, or provide staged distributions that promote financial stability for beneficiaries. A coordinated plan reduces the chance of conflicting beneficiary designations or unintended estate inclusion, and it equips trustees with the authority and guidance needed to manage proceeds responsibly. This reduces administrative burdens on loved ones and supports long term objectives for preserving family wealth and meeting post-death obligations efficiently.
One of the primary benefits of a properly structured ILIT is the potential to keep life insurance proceeds out of the taxable estate, thereby lowering estate tax exposure when other assets push an estate toward tax thresholds. By removing incidents of ownership and directing how proceeds are managed and distributed, the trust provides greater control over the ultimate use of funds. This benefit supports long term planning goals such as preserving family property, funding trusts for descendants, or ensuring that business succession plans have the liquidity they need to succeed after an owner’s death.
An ILIT can include provisions that shield life insurance proceeds from certain creditor claims against beneficiaries and set distribution conditions that protect young or vulnerable recipients. The trust also centralizes administration under a named trustee, reducing confusion about how proceeds should be allocated and enabling consistent record keeping and tax compliance. These features combine to provide both practical support for beneficiaries and peace of mind for grantors, who can design terms that reflect family priorities and ensure funds are used in ways that align with long term objectives.
When funding an ILIT with annual gifts to cover premiums, maintain clear records documenting each gift and how the funds are used to pay policy premiums. Proper documentation supports reliance on annual gift tax exclusions and makes it easier to demonstrate that transactions were handled according to the plan. Communicate regularly with the trustee about premium schedules and anticipated changes in policy costs so the trust can remain current on payments. Good record keeping reduces the risk of disputes and provides transparency for beneficiaries and tax reporting.
Ensure the ILIT is coordinated with your will, revocable living trust, beneficiary designations, and any related documents such as a Pour-Over Will or certification of trust. Aligning the ILIT with other planning instruments avoids conflicting instructions and ensures that policy proceeds support broader estate goals. Review these arrangements regularly to account for life events such as births, deaths, marriage, divorce, or changes in asset levels. Periodic reviews help keep the plan current and responsive to family needs while maintaining the intended protective features of the trust.
Residents of Arcadia often consider an ILIT when they want to remove life insurance proceeds from their taxable estate, provide orderly distributions to heirs, or ensure liquidity to cover estate expenses and obligations. An ILIT can be useful where beneficiaries need controlled distributions over time, where protection from potential future creditor claims is desired, or where coordinating insurance with other trust arrangements is a priority. This paragraph outlines typical motivations for pursuing an ILIT and how it can serve as a strategic component of a comprehensive estate plan for families and business owners.
People also turn to ILITs when they want to plan for children with special financial needs, provide for minors, or preserve a legacy through trusts that manage distributions over many years. An ILIT can be paired with retirement plan trusts, special needs trusts, or other instruments to ensure that life insurance proceeds are used in ways that support long term financial security. This approach helps ensure clarity about the grantor’s intentions and reduces the administrative burden on survivors who might otherwise have to make complex decisions during an emotional time.
Common circumstances that lead individuals to establish an ILIT include significant life insurance holdings, concerns about estate tax exposure, the desire to provide managed distributions for beneficiaries, and the need for liquidity to satisfy estate obligations. Business owners may use an ILIT to ensure funds are available for succession planning, while parents may use it to secure funding for minors or family members with limited capacity to manage large sums. This paragraph summarizes the typical scenarios where an ILIT can address practical and financial concerns for Arcadia families.
When a family owns substantial life insurance policies, transferring ownership into an ILIT can prevent those proceeds from increasing estate tax exposure. This is particularly relevant if other assets already place the estate near tax thresholds or if the family expects future growth in wealth. An ILIT provides a mechanism to preserve the full value of insurance proceeds for beneficiaries by keeping them out of the grantor’s estate, while also allowing the grantor to specify distribution terms and administrative procedures for managing the funds after death.
An ILIT can ensure that funds are available immediately after death to pay estate taxes, debts, and administrative costs without forcing the sale of other estate assets. This liquidity is often critical for families that own illiquid assets such as real estate or closely held businesses. By holding life insurance proceeds in a trust with clear instructions for use, the estate gains access to readily available cash that can be used to meet obligations while other estate assets are distributed according to the will or trust.
An ILIT can be structured to provide long term protection for beneficiaries who are minors, have limited financial experience, or face significant creditor risks. Trust terms can specify staged distributions, custodial arrangements, or ongoing oversight by a trustee to ensure funds are used responsibly and in alignment with the grantor’s wishes. This protective structure reduces the likelihood that a large lump sum will be mismanaged or exposed to claims, providing a controlled framework for supporting vulnerable family members over time.
The Law Offices of Robert P. Bergman is available to assist Arcadia residents with the formation, funding, and administration of Irrevocable Life Insurance Trusts. We guide clients through the necessary steps, help with trustee selection and trust drafting, and coordinate transfers and premium funding to align with broader estate plans. Our approach emphasizes clear documentation, practical administration, and thoughtful coordination with wills, revocable trusts, and related instruments so families feel confident that life insurance proceeds will be handled according to their intentions.
Clients choose the Law Offices of Robert P. Bergman because we provide attentive, personalized estate planning services that address both tax and practical administration concerns. We work with clients to draft trust documents that reflect their wishes, coordinate transfers of existing policies, and set up premium funding arrangements that are easy to administer. Clear communication and careful attention to detail help ensure that ILITs function as intended and that trustees have the information they need to fulfill obligations and protect beneficiaries.
Our team assists with related estate planning instruments such as revocable living trusts, wills, powers of attorney, health care directives, and pour-over wills to ensure cohesive plans that leave no loose ends. We explain how an ILIT integrates with retirement accounts and other assets, and we help clients anticipate and plan for future changes. This comprehensive coordination reduces the risk of conflicting documents and improves the likelihood that long term objectives will be met without unnecessary dispute or administrative delay.
We also provide practical guidance on trustee responsibilities, premium funding strategies using annual gift exclusions, and record-keeping practices to support tax compliance and transparency. Our goal is to make the process manageable for the grantor and the trustee while preserving the benefits of the trust structure for beneficiaries. By focusing on planning, documentation, and administration, we help Arcadia clients create ILITs that deliver meaningful protection and peace of mind for their families.
Our process begins with an initial consultation to review your goals, existing policies, and overall estate plan. We then draft an ILIT tailored to your circumstances, prepare the necessary assignment or ownership transfer documents, and outline premium funding options. After the trust is funded, we provide guidance to the trustee on administrative responsibilities and coordinate with other advisors as needed to ensure proper record keeping and tax compliance. Ongoing support is available for trustee transitions, policy changes, or questions that arise after the trust is in place.
The initial planning stage involves reviewing your current life insurance policies, estate documents, and family circumstances to determine whether an ILIT is appropriate and, if so, how it should be structured. We discuss ownership transfer timing, funding strategies, trustee options, and how the trust will integrate with your will and other trusts. This stage produces a recommended plan and a checklist of documents and steps required to establish and fund the trust effectively while minimizing the risk of unintended tax consequences.
We carefully review existing life insurance policies, beneficiary designations, and estate planning documents to identify potential conflicts and to map out the transfer process. This review helps determine whether a policy should be reassigned to a trust, whether a new policy should be purchased by the trust, and how beneficiary designations should be coordinated. Clear identification of asset ownership and documentation needs at this stage minimizes later administrative burdens and clarifies the practical steps for funding and maintaining the ILIT.
We assist in selecting an appropriate trustee or trustees and draft a trust document that outlines powers, distributions, successor trustees, and administrative procedures. The drafting process incorporates provisions for premium funding, record keeping, and distribution terms to align with your plan objectives. The trust document is crafted to provide administrative clarity and to reduce points of ambiguity that could otherwise lead to disputes or inefficient administration after the grantor’s death.
Funding the ILIT often involves transferring an existing policy to the trust or arranging for the trust to purchase a new policy and establishing the premium funding mechanism. We prepare assignment documents, communicate with insurance carriers, and help implement gift transfers to the trust for premium payments when necessary. Proper timing and documentation of these transactions are essential to achieve the intended estate and tax treatment, and we manage these logistics to reduce the risk of technical errors that could compromise the trust’s benefits.
Transferring ownership requires formal assignments and updates to the insurer’s records to reflect the trust as owner and often as beneficiary. We coordinate with the carrier to ensure the changes are processed correctly and confirm that the trust has the necessary powers to manage the policy. This coordination includes verifying the requirement for any insurer forms, confirming premium schedules, and ensuring the trustee knows how to interact with the carrier to maintain coverage and address any policy servicing needs.
We help document annual gifts or other funding mechanisms intended to cover premiums and set up procedures the trustee will follow to track gifts and payments. Clear recordkeeping supports reliance on gift tax exclusions and demonstrates that premium payments were made in accordance with the trust’s terms. We provide templates and guidance for maintaining records that the trustee can use to respond to tax inquiries or beneficiary questions in the future, which aids in maintaining the integrity of the trust arrangement.
After the ILIT is established and funded, ongoing administration includes paying premiums, maintaining records, filing any required returns, and preparing for the trust’s role after the insured’s death. When the insured passes, the trustee files claims with the insurer, collects proceeds, and distributes funds according to the trust terms. We provide trustee support, guidance on tax filings, and assistance with any required trust accounting to make the post-death process orderly and aligned with the grantor’s objectives for beneficiaries.
The trustee’s responsibilities during the trust’s active period include making premium payments, maintaining updated records of gifts and disbursements, and communicating with beneficiaries about relevant trust matters. Trustees should also keep copies of policy documents, assignment records, and trust instruments to ensure the trust remains effective. We provide checklists and guidance for trustees to help them fulfill these duties responsibly and to prepare for the eventual claim process after the insured’s death.
Upon the insured’s death, the trustee files the insurance claim, secures the proceeds, and administers distributions according to the trust terms while addressing creditor claims and tax obligations as needed. We assist trustees in preparing required documentation, responding to insurer inquiries, and making distributions that reflect the grantor’s intentions. Our firm also supports trustees through any necessary tax reporting, accounting, and beneficiary communications to ensure the settlement of the trust is handled with transparency and fidelity to the governing trust document.
An Irrevocable Life Insurance Trust is a trust created to own and manage life insurance policies so proceeds are paid into the trust and distributed according to its terms rather than through probate. Establishing an ILIT typically involves transferring ownership of a policy to the trust or having the trust purchase a new policy, and the trust document specifies how proceeds will be used and who will receive distributions. The primary goals often include removing the policy from the grantor’s taxable estate, providing liquidity at death, and structuring distributions to protect beneficiaries. You might consider an ILIT if you have substantial life insurance holdings, face potential estate tax exposure, need to provide controlled distributions for heirs, or want to coordinate insurance with other estate planning instruments. The effectiveness of an ILIT depends on proper drafting, timely transfers, and clear funding mechanisms. Because an ILIT is irrevocable, the decision requires careful consideration and planning to ensure it aligns with your long term estate objectives.
Transferring an existing life insurance policy to an ILIT generally requires executing an assignment of ownership and updating the insurer’s records to reflect the trust as owner. The trust must be properly drafted and signed, and the insurer will typically require a change of ownership form. Coordination with the trustee is essential so they are prepared to manage premium payments after the transfer. Proper documentation of the assignment and confirmation from the insurer are important to avoid disputes and ensure the transfer is recognized. Timing is an important consideration because transfers made shortly before the insured’s death may be subject to estate inclusion rules. To preserve the intended estate tax benefits, transfers should be completed well in advance of any anticipated death and accompanied by appropriate funding arrangements for ongoing premiums. We recommend a careful review of the policy, insurer requirements, and gift tax implications before implementing a transfer.
Once a policy is transferred to an ILIT, the grantor typically relinquishes the right to change the beneficiary or otherwise exercise incidents of ownership that would cause the policy to be included in the taxable estate. The trust document designates the beneficiaries and outlines how proceeds will be distributed. While trustees may have administrative powers to manage the policy, changes to beneficiary designations are governed by the trust terms and the trustee’s authority as set forth in the document. If flexibility is a priority, the grantor should discuss options during the planning phase, such as naming a trust with specific amendment mechanisms or choosing alternative planning tools. Because transferring ownership removes certain controls, it is important to confirm that the trust’s distribution terms and trustee powers reflect the grantor’s intentions before completing the transfer.
Premiums for policies held by an ILIT are commonly funded through annual gifts from the grantor to the trust. The trustee uses those gifts to pay premiums, and when structured correctly the gifts may qualify for the annual gift tax exclusion. Accurate record keeping and clear documentation of gifts and premium payments are essential to support this approach and to demonstrate that the trust was properly funded for tax purposes. Poorly documented funding can create complications in tax reporting and administration. The tax implications vary depending on timing, the nature of gifts, and whether the grantor retained incidents of ownership prior to transfer. Transfers made within a short period before death may be pulled back into the estate for estate tax purposes, and gift tax rules should be considered when funding premiums. Careful planning and documentation reduce risk and help achieve the intended tax and estate objectives for the ILIT.
In many circumstances, an ILIT can provide a degree of protection for life insurance proceeds from claims against beneficiaries, because the trust holds the proceeds and distribution terms can be designed to limit direct ownership by beneficiaries. Trust provisions that distribute in stages, appoint a trustee with discretion, or include spendthrift protections can reduce the likelihood that funds are immediately available to creditors. The level of protection depends on the trust terms and applicable state law regarding creditor claims. While an ILIT can offer meaningful protections, it is not an absolute shield in every situation. The drafting of the trust and the timing of transfers are critical factors, and other planning tools such as spendthrift clauses or separate protective trusts may be integrated with the ILIT to bolster protections. A careful review of beneficiary exposure and coordination with overall asset protection strategies can enhance outcomes.
If the insured dies shortly after transferring a policy to an ILIT, estate inclusion rules may apply that could cause the proceeds to be included in the taxable estate. Federal rules generally look to whether incidents of ownership were retained or whether transfers occurred within a specified lookback period, which can negate some of the intended estate tax benefits. Because of these rules, transfers made close to the time of death may not achieve the desired estate exclusion and should be evaluated carefully before implementation. To mitigate this risk, grants should be made and transfers completed well in advance of anticipated life events, and alternative planning options should be considered if timing is tight. Detailed documentation of the transfer and any funding arrangements can also help clarify the grantor’s intention, but the timing concern highlights the importance of early planning and coordination with other estate planning measures to preserve intended benefits.
Selecting a trustee for an ILIT involves evaluating administrative capabilities, willingness to communicate with beneficiaries, and familiarity with basic trust duties. A trustee may be an individual family member, a trusted friend, a professional fiduciary, or a corporate trustee; each option has advantages and tradeoffs in terms of continuity, cost, and administrative capacity. The chosen trustee should be prepared to handle premium payments, maintain records, and interact with advisors, beneficiaries, and the insurance company as needed. It is also prudent to name successor trustees to ensure continuity and to include guidance within the trust document about how trustees should make distribution decisions and handle tax reporting. Discussing the role with prospective trustees beforehand helps ensure they understand the responsibilities and are willing to serve, which reduces the chance of administrative disruption when the trust needs active management.
An ILIT should be coordinated with your will and any revocable living trust so that beneficiary designations and distribution plans do not conflict. While an ILIT holds life insurance proceeds separately, the overall estate plan should reflect how those proceeds interact with probate assets, pour-over wills, and other trusts. Coordination ensures that your full estate plan presents a coherent set of instructions for asset distribution and addresses how life insurance will complement or provide liquidity for other inherited assets. We review all estate planning documents during the ILIT planning process to identify potential inconsistencies and to align beneficiary designations, pour-over provisions, and trust terms. This integrated approach reduces the likelihood of unintended results and provides a clearer roadmap for trustees and heirs to follow after the grantor’s death, supporting a smoother transition for family members.
Yes, ILITs have ongoing administrative requirements including making timely premium payments, maintaining records of gifts and disbursements, and preparing any necessary tax filings. The trustee must keep accurate documentation of funding transactions and premium payments to support tax treatment and to provide transparency to beneficiaries. Without careful administration, the risk of inadvertent inclusion in the estate or disputes among beneficiaries can increase, so proactive record keeping and trustee oversight are important for long term success. Periodic reviews are also advisable to confirm that insurance carriers have current contact information and that trust terms continue to reflect the grantor’s wishes. Changes in policy terms, premium costs, or family circumstances may warrant adjustments in funding strategies or trustee guidance, and having a plan for these eventualities helps preserve the ILIT’s intended benefits over time.
To get started with an ILIT in Arcadia, schedule an initial consultation to review your life insurance holdings, estate planning goals, and family circumstances. During this meeting we will discuss whether an ILIT is appropriate for your situation, outline the process of drafting and funding the trust, and provide a timeline for implementation. We will also identify any related estate planning steps needed to ensure the ILIT integrates smoothly with your existing documents and objectives. After the consultation, we prepare a customized plan and draft the trust document, coordinate necessary policy transfers or purchases, and provide guidance on premium funding and trustee duties. We also offer ongoing support for trustees and can assist with claim processing and trust administration after the insured’s death. Taking a stepwise, documented approach helps ensure the ILIT operates as intended and delivers the intended protections for your beneficiaries.
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